ABM Resources Ltd extends 1.67m ounce Buccaneer gold deposit with new zone

ABM Resources (ASX: ABU) has further extended the 1.67 million ounce Buccaneer Porphyry Deposit south, discovering another new porphyry hosted mineralised zone, called Eastern Contact, at the Twin Bonanza Gold Camp in the Northern Territory.
Along with the high grade Old Pirate Prospect, ABM now has five drilled mineralised zones, four of which are pending drilling to first resource.

Hole BCRC100047, testing southern extensions of Buccaneer, intersected 251 metres averaging 0.33 grams per tonne (g/t) gold (0.2g/t cut-off) with several zones of higher grade including 76 metres averaging 0.53g/t gold (0.5g/t cut-off).

The hole intersected mineralisation at 51 metres and stayed in mineralisation until hitting the contact with the sediments at 302 metres.

The Eastern Contact Zone is open in all directions. The first hole in the zone intersected 104 metres averaging 0.39g/t gold (0.2g/t cut-off) ending in mineralisation, including 48 metres averaging 0.58g/t gold (0.5g/t cut-off).

Darren Holden, managing director of ABM Resources, said “the Eastern Contact Zone is yet another discovery, which, in addition to the Caribbean and Empress Zones, makes three new mineralised zone discoveries within a 500 metre radius of the 1.67 million ounce Buccaneer Porphyry Gold Deposit already this year.

"Along with the high grade Old Pirate Prospect we now have five drilled mineralised zones, four of which are pending drilling to first resource. The Eastern Contact Zone, albeit lower grade, is the same style of disseminated mineralisation as Buccaneer, and hence provides an important indicator for follow-up drilling targeting higher grade zones."

This mineralisation in the Eastern Contact Zone is open along strike as well as above to surface, and below the existing intersection. Other targets drilled at Twin Bonanza are pending assay.

The Caribbean Zone follow up hole (BCRC100054) intersected more than 30 metres of very intense alteration, elevated arsenic and quartz veins comparable with the Caribbean discovery hole.

At the Landlubber Target the first holes intersected intercalated sediments, quartz veins and a highly altered intrusive rock possibly analogous to the Buccaneer Porphyry with elevated arsenic levels.

"We have been encouraged by visual signs of alteration and veins at the holes following up on the Caribbean Zone discovery, as well as the first systematic drill campaigns at the Landlubber Target,” added Holden.

In addition, the first holes at the Cypress Target hit the northern end of Buccaneer Porphyry with alteration and veins.

The company has also cleared the sample freight backlog with 5000 drill samples delivered to the laboratory last week for assay with results expected shortly.

Drilling is on-going at the Twin Bonanza Gold Camp. A total of 34 deep reverse circulation holes and three deep diamond core holes have been completed at Twin Bonanza so far this season.

The company is currently drilling at the Corsair target located 1.5 kilometres north of the Old Pirate High Grade Gold Prospect where a total of 6 holes have been designed to test an extensive regolith geochemical anomaly on the same structural trend as Old Pirate.

Also, drilling at the Kroda Gold Project located near the town of Barrow Creek on the Stuart Highway north of Alice Springs is progressing with a total of 6 holes of a 12 hole program complete and pending assay.

Following completion of the Kroda program the company said the regional exploration team will mobilise to the Lake Mackay Iron Oxide Copper Gold targets for deep drill testing of several target areas.

The Twin Bonanza Gold Camp is located about 22 kilometres south of the Tanami Road and 14 kilometres east of the Western Australia – Northern Territory border.

The project spans the highly prospective “Trans Tanami Structure” an inferred regional / tectonic geological feature which hosts numerous gold deposits including Newmont’s (NYSE: NEM) multi-million ounce Callie Gold Mine.

ABM is well funded and is focusing its effort on Buccaneer extensional targets, Old Pirate (trenching and drilling) and intends to test up to 10 of the other targets in the wider Twin Bonanza Gold Camp, for the remainder of 2011.

ABM aims to upgrade some of the Resource at Twin Bonanza to an “Indicated Resource” category in coming months.

With a gold resource of 1.67 million ounces versus a current market valuation of sub-$100 million, ABM Resources' valuation is light.

If the company's drilling success rate is anything to go by, ABM Resources is likely to be re-rated.

Originally published at: http://www.proactiveinvestors.com.au/companies/news/17944/abm-resources-ltd-extends-167m-ounce-buccaneer-gold-deposit-with-new-zone-17944.html